Last month Societe Generale's Wei Yao wrote that despite reports
that reforms were unlikely after the handover of power, it looked
increasingly likely that
Xi Jinping would reform China.

The new policies include:

Measures for the supervision and administration of
unlisted public companies[published October
11th 2012]. This is the first law to supervise
unlisted public companies i.e. companies that can have
unlimited shareholders but are too small to be listed on a
stock exchange. It allows shares of unlisted public companies
to be "publicly transferred in stock exchanges duly established
abiding by the laws", and allows for more than 200
shareholders.

Rules for corporate governance of securities companies
[published December 14, 2012]. "A securities company
shall have the obligation of good faith for clients, and shall
not infringe upon the property right, the right to choose, the
right to fair trade, the right to know and other lawful rights
and interests of clients," according to China Securities
Journal.

While changes to the capital controls are very welcome, investors
should probably heed Yao's warning that the path of rebalancing
will be bumpy and while the impact of good reforms is positive
for business, consumers and investors, it is "not entirely
positive for short- term growth."